Kategorie: Regulation

The US Congress continues to pass business-friendly legislation, but many in the cryptoasset space complain that ambiguities in federal securities laws will prevent initial coin offering issuers (ICOs) from taking advantage of them. Last week, the House of Representatives passed the Regulation A+ Improvement Act of 2017, which seeks to implement a 50 percent increase

President Donald Trump’s executive order banning US residents from engaging in transactions related to Venezuela’s “Petro” cryptocurrency could give the federal government an opening to regulate cryptocurrencies more closely under the guise of national security. The order, signed by Trump on Monday and effective immediately, makes it illegal for US citizens and residents to transact

A district court in Kiev Oblast has accepted a lawsuit which is setting a precedent in Ukraine. The plaintiff seeks compensation in bitcoin for “moral damages” caused by law enforcement officials. A preliminary hearing has been scheduled after the presiding judge found no legal grounds to reject the claim.

Setting a Precedent

For the first time in Ukraine’s judicial practice, a claim for compensation in cryptocurrency has been accepted by a local court. Ukrainian citizen Dmitriy G. wants to be paid 1 BTC for “moral damages” he suffered in result of an “unlawful” search. He is suing officers from Ukraine’s Security Service (SBU) and their colleagues from the Prosecutor’s Office who conducted the operation.

Borispolskiy Court’s decision (Forklog)

Borispolskiy District Court in Kiev Oblast has agreed to look into the case and has even scheduled a preliminary hearing, Forklog reports. Judge Zhuravskiy found no legal grounds to reject the lawsuit, according to a document, acquired by the outlet.

All applicable norms have been observed, according to the court, which has already sent a copy of its resolution to the defendants. They have 15 days to respond officially to the claims made by the plaintiff. If the government agencies fail to do so, the court proceedings will continue based on the available information.

Regardless of the end result, the legal action has already set a precedent in Ukraine’s court practice. If Dmitriy is granted the bitcoin compensation he seeks, that would de facto legalize cryptocurrencies as means of payment in the country.

Bitcoin in Legal Limbo

Technically and legally, the status of cryptocurrencies in Ukraine is still undefined. At least three drafts have been introduced in parliament since last October. One of the bills defines cryptocurrency as property that can be exchanged for goods and services. Another one states that cryptos are financial assets. A third, supplementary draft amends Ukraine’s tax code to introduce exemptions for crypto profits and incomes. No real progress towards the adoption of new legislation has been reported in 2018.

There have been multiple calls, including from officials and institutions, for the regulation of cryptos, like bitcoin. A cybersecurity meeting in January discussed cryptocurrencies and the National Security Council set up a working group tasked to finalize proposals. Ukraine’s Cyberpolice also called for the legalization of cryptocurrencies.

Earlier, the country’s justice minister Pavel Petrenko stated that digital currencies should be brought into the legal field. The State Financial Monitoring Service has already announced its official position on cryptocurrency matters. Ukraine’s parliament, however, has made no significant advances towards adopting a comprehensive regulatory framework.

Some statements suggest that Ukrainian legislators may separate crypto mining and cryptocurrencies in the new legislation. Mining can be legalized in the country before decisions are made in regards to the status and the circulation of cryptos. Recently, Ukraine’s Minister of Economy ordered several ministries and agencies to prepare the documents necessary to add crypto mining to the state register of economic activities.

Do you think similar cases can effectively legalize bitcoin even before dedicated legislation has been passed by lawmakers? Share your opinions in the comments section below.

Images courtesy of Shutterstock, Forklog.

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The Bitcoin and Ripple prices headlined a $45 billion cryptocurrency market rally that appeared to be predicated on optimism that this year’s G20 summit will not produce an international framework on cryptocurrency regulations. Bitcoin, Ripple Prices Leads $45 Billion Cryptocurrency Market Rally Monday brought a welcome respite for cryptocurrency investors, as the markets demonstrated a

U.S. president Donald Trump has signed an executive order banning American citizens from using Venezuelan cryptocurrencies. In effect, this means that the petro, recently launched by Venezuelan president Nicolas Maduro, is now illegal in the U.S. The controversial cryptocurrency was widely seen as a means to evade economic sanctions imposed by the U.S. The executive order is the latest move by the Trump administration to cut off Maduro’s funding, and is the first time the U.S. president has been officially linked with cryptocurrency.

U.S Vetoes the Petro

“I, DONALD J. TRUMP, President of the United States of America, in order to take additional steps with respect to the national emergency declared in Executive Order 13692 of March 8, 2015, and relied upon for additional steps taken in Executive Order 13808 of August 24, 2017, and in light of recent actions taken by the Maduro regime to attempt to circumvent U.S. sanctions by issuing a digital currency in a process that Venezuela’s democratically elected National Assembly has denounced as unlawful, hereby order as follows,” begins the order published on the White House website today, March 19.

The order continues: “All transactions related to, provision of financing for, and other dealings in, by a United States person or within the United States, any digital currency, digital coin, or digital token, that was issued by, for, or on behalf of the Government of Venezuela on or after January 9, 2018, are prohibited as of the effective date of this order.” Due to the pseudo-anonymous nature of cryptocurrencies, it would be extremely difficult for U.S. authorities to catch anyone illegally trading the petro on domestic soil. The ban is largely a symbolic one.

This Kills the Petro

Nicolas Maduro

That the Trump administration should choose to kill the petro comes as no surprise. The announcement, when it arrived, was sudden and without warning though. The significance of this being the first executive order to prohibit use of a cryptocurrency is notable, even though it is a regime, and not crypto, that’s the direct target. (A previous order signed by President Obama enabled authorities to confiscate crypto, but referred only to “cyber-enabled activities”.) President Trump has issued 65 such orders since coming to office, an average of 56 per year. That makes him the 15th most prolific president for issuing orders, considerably far behind President Roosevelt who churned out 307 per year.

The petro isn’t explicitly named in the executive order, although Petroleos de Venezuela is, and there’s no doubt which crypto the U.S is seeking to ban. The order curtailing use of the petro is unlikely to directly affect U.S investors, who will have already known to avoid it. It may cause other nations to stay away, however, for fear of irking the U.S.

If an executive order can be filed restricting the use of the petro, there is no reason, theoretically, why a similar decree couldn’t be made against privacy coins, for example, if the U.S. deemed them a threat. In practise, there is nothing to suggest today’s order is the thin end of the wedge, and that further decrees will be forthcoming. It’s certain that cryptocurrencies will have cropped up in President Trump’s daily briefings since coming to office. Today will go down in history, however, as the first time a U.S. president signed an executive order devoted to cryptocurrency.

Do you think the president’s executive order will affect sales of the petro? Let us know in the comments section below.

In a bid to reduce systemic risk, the Israel Securities Authority has announced that it will not include companies operating in the cryptocurrency industry will not be included in the country’s stock exchange indices. News of the determination has been published alongside a public warning issued that seeks to inform prospective investors of the risks associated with cryptocurrency exposure.

Israel’s financial regulator, the Israel Securities Authority (ISA), has announced that companies primarily operating in the cryptocurrency sector will not be included in stock exchange indices.

According to a rough translation, ISA Chairperson, Ms. Anat Gueta, stated “We decided to avoid exposure to passive investors for companies whose operations are mainly in [crypto]currencies,” adding “These are companies in which the investment is high risk, speculative and volatile.”

The ISA states that the determination has been made in response to “the exceptional trading in securities of companies on the Tel Aviv Stock Exchange who announced in recent months that they intend to operate in the cryptographic currency sector.” In some instances, the regulator asserts that just the announcement a company may be exploring blockchain technology “led to a sharp rise in share prices, even before they have true activity.”

ISA Seeks Amendment to Stock Exchange Regulation

The ISA has stated that it will “act to promote a temporary amendment to [Israel’s] stock exchange regulation, which will limit the entry into indices of companies whose main activity is the holding, investment, or mining of distributed cryptographic currencies.”

Israel’s financial regulator described the objective of the amendment as “prevent[ing] public companies operating in this risky and speculative field […] from entering the stock exchange indices and [being] included in the portfolios of passive investors.” The ISA hopes to introduce said amendment for “a limited period of one year,” after which the law “will be re-examined in accordance with developments in the market.”

The ISA has expressed concerns if it had not intervened, that the “combination of cryptographic and stock index companies would have let [to] mutual funds and ETFs […] acquire shares in these companies,” thus “indirectly expos[ing] passive investors to” the “potential for […] significant loss[es].”

What is your response to the ISA’s decision to prohibit cryptocurrency companies from being included in stock exchange indices? Share your thoughts in the comments section below!

One of the biggest mysteries in the cryptocurrency world at the moment is the location of the vast USD reserves meant to be backing Tether. The stablecoin is used by many exchanges as a proxy for fiat in trading pairs which makes its solvency a critical issue at the heart of the entire ecosystem. Now, new research indicates that we might be getting closer to getting answers about the operation of USTD.

Tether’s Primary Reserve Bank Found?

Bitmex Research has released an update today to its deep investigation into Tether from last month. It shows that newly released data from Puerto Rico supports the speculation that Noble International Bank could be Tether’s primary reserve bank and that the island is a major hub for cryptocurrency business.

The Commissioner of Financial Institutions of Puerto Rico just released aggregate financial-system data for 2017. Bank deposits in the International Financial Entities category, which includes Noble Bank, were $3.3 billion, up 248% in the quarter ended December 2017. Total assets in the category were $3.8 billion, up 161% in the quarter.

The researchers explain that this “extraordinary growth coincides with a large increase in value of cryptocurrency assets, which has likely resulted in large cash inflows into cryptocurrency-related banks. Over the same period, the value of Tether in issue has increased by 215% to $1.4 billion.” They thus conclude that: “This new data supports the thesis in our recent piece on Tether, in which we speculated that Noble Bank is Tether’s primary reserve bank.”

Noble International Bank

When it promoted itself to the FX and OTC industry, Noble Bank International (NBI) explained that: “The state-chartered bank, based in the US Territory of Puerto Rico, is regulated under US federal law. NBI is a non-fractional reserve bank. This means that NBI does not lend or re-hypothecate client assets; rather, assets are legally segregated in the name of the client and bankruptcy-remote, held at NBI’s global custodian, BNY Mellon.” If this is also true under the same entity that serves Tether, it would suggest the stablecoin has direct exposure to US regulators.

As Bitmex Research pointed out in their previous report, there is also anecdotal evidence for a possible link between the bank and the stablecoin. The founder and CEO of Noble, John Betts, was behind the 2014 Sunlot Holdings move to take over and potentially rescue MtGox. And Sunlot was backed by Brock Pierce, one of the founders of Tether.

A representative of the bank only had this to say to news.bitcoin.com today: “As a matter of company policy, Noble doesn’t disclose client information.”

Should the cryptocurrency community even want Tether’s reserve bank to be exposed? Share your thoughts in the comments section below!

Images courtesy of Shutterstock.

Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

The Financial Stability Board, G20’s global watchdog, does not consider cryptocurrencies a risk to financial stability. In a letter to the Group of 20 central bankers and finance ministers, its Chair Mark Carney said FSB was pivoting away from designing new policies and focusing on reviewing existing rules. His comments suggest there is no G20 consensus on common crypto regulations, despite calls from member-states for adopting global guidelines.

No Consensus for Global Crypto Regulations

The Financial Stability Board (FSB), the body that coordinates financial regulation for the G20 countries, has effectively dismissed calls from member-states to adopt global cryptocurrency rules. “The FSB’s initial assessment is that crypto-assets do not pose risks to global financial stability at this time,” its Chair Mark Carney said in a letter to central bankers and finance ministers, Reuters reported.

Representatives from G20 countries are meeting today in Argentina. Statements in several member-states suggested that crypto regulations would be on the agenda of the summit. In February, high-ranking French and German officials issued a letter urging their colleagues to discuss the implications of cryptocurrencies, like bitcoin, within the G20 format. According to recent reports from Tokyo, Japanese representatives intended to push for global rules on cryptocurrencies.

Carney’s comments suggest, however, that there is not enough consensus for a common approach to cryptocurrency regulation. The Financial Stability Board insists on more international coordination in monitoring the rapidly evolving crypto sector. “As its work to fix the fault lines that caused the financial crisis draws to a close, the FSB is increasingly pivoting away from design of new policy initiatives towards dynamic implementation and rigorous evaluation of the effects of the agreed G20 reforms,” its Chair said.

Mark Carney

Mark Carney, the serving governor of the Bank of England, recently called for greater regulation of cryptocurrencies. “The time has come to hold the crypto-asset ecosystem to the same standards as the rest of the financial system,” he stated in a speech earlier this month. Carney described the volatility associated with crypto markets as “speculative mania”. Commenting on the possibility of adopting global crypto rules, he admitted the regulation would likely be on a country-by-country basis.

“I would have a greater expectation for a series of national steps rather than some big coordinated approach,” the central banker said. He also voiced support for the idea to regulate some elements of the crypto-asset ecosystem to “protect the safety and soundness of the financial system”.

Carney will stand down as FSB’s Chair next year, when his term as Governor of the Bank of England ends. The G20 summit will take place in the Argentine capital Buenos Aires on March 19-20.

The Financial Stability Board (FSB), an international body that monitors the global financial system to promote stability and coordinates financial regulation for G20 nations has dismissed calls from some G20 members to regulate cryptocurrencies like bitcoin. In a letter [PPDF] sent to G20 finance ministers and central bank governors on the eve of this year’s … Continued

Thai regulators have reportedly agreed to enact two separate laws on cryptocurrencies and initial coin offerings. They will regulate crypto businesses, the purchase and sale of cryptocurrencies, as well as their taxation.

Two Laws Being Drafted

Mr. Apisak Tantivorawong.

The Thai Minister of Finance, Mr. Apisak Tantivorawong, said on Thursday that the government is preparing to announce the regulations for cryptocurrencies and initial coin offerings (ICOs) by the end of this month, Channel 7 news reported.

After the cabinet’s meeting, the country’s deputy prime minister, Mr. Somkid Jatusripitak, explained that two laws are being drafted, according to Thai Rath newspaper.

The first is the Act on Digital Asset Businesses. It requires the registration and know-your-customer (KYC) compliance of cryptocurrency operators including agents, dealers, and brokers, the news outlet detailed. It also imposes penalties and remedies for violations.

The second is the revision of the country’s Revenue Code which concerns taxation related to cryptocurrencies and ICOs, the publication described.

Regulating Crypto Businesses & Taxation

According to Thai Rath, cryptocurrency and ICO businesses such as intermediaries will be required to identify themselves and the sources of crypto investment funds in order to prevent money laundering. These businesses will be obligated to provide transaction information as well as the names of buyers and sellers to the Anti-Money Laundering (AML) Office. The law also puts the Securities and Exchange Commission of Thailand (SEC) in charge of the regulations. The news outlet elaborated:

Thai private companies that have already issued an ICO must comply with the law within 6 months.

Moreover, Mr. Apisak has ordered the Thai Revenue Department to collect 7% VAT and 15% withholding tax on cryptocurrencies and ICOs, the publication noted, adding that taxpayers can combine their crypto tax liabilities with their annual income.

Central Bank Will Not Change Stance

The Bank of Thailand (BOT) said that it will not change its stance regarding cryptocurrencies and ICOs, the news outlet detailed. In February, the central bank prohibited financial institutions from five key cryptocurrency activities, which will remain in effect even after the regulations are in force.

Following the BOT’s prohibition, Bangkok Bank subsequently terminated the accounts of a local cryptocurrency exchange.

Another major bank, Krungthai Bank, soon followed suit and terminated the accounts of local crypto exchanges with them. Mr. Piyong Sriwanich, the bank’s president, was quoted by Thai Rath on Thursday declaring that his bank does not support and will not deal with cryptocurrencies in any way. Furthermore, he emphasized that if anyone opens “a deposit account with the bank and invests money in digital currency, the bank will close the account immediately.”

What do you think of Thailand’s cryptocurrency regulations? Let us know in the comments section below.

New Innovations and Markets Presents America’s Regulatory and Legislative Institutions With Unique Challenges

Every year the U.S. Congress publishes an economic report that discusses a variety of subjects that affect the economy such as technology, opioid abuse, employment rates, and the stock market. This year’s “2018 Economic Report” features a whole chapter focused on bitcoin, initial coin offerings (ICOs), and blockchain technology. Chapter nine is called, “Building a secure future, one blockchain at a time.” The congressional study takes note that last year cryptocurrencies had entered a mainstream awareness phase.

“Blockchain technology — providing cybersecurity and many other potential benefits—broke into the mainstream in 2017 driven by widespread interest and surging valuations in digital currencies such as bitcoin and ethereum,” explains the report.

These new innovations and markets presented America’s regulatory and legislative institutions with unique challenges as well as technology that could revolutionize the world’s digital landscape and economy.

The Study Compares Cryptocurrencies to the Internet

The economic study is meant to use analysis and create conclusions in order to assist individual government committees and Congress. Chapter nine calls 2017 “The Year of Cryptocurrencies,” and the technology’s phenomenal rise is considered a significant economic event that stands out to the report’s researchers. The study also emphasizes how well traditional stocks did last year, but they did not compare to digital asset markets.

The buzz surrounding digital currencies resembles the internet excitement in the late 1990s when people recognized technology companies could change the world — Many internet companies launched and their valuations took off in short order — Many failed, but a few succeeded spectacularly and challenged the conventional ways of doing business.

The U.S. 2018 Economic Report. Chapter 9.

Regulations Must Curtail Crypto-Growing Pains and Misuses

Of course, the report details that control is needed for these nascent technologies. It also highlights the possibility of fraud within the ICO market but recognizes how well the crowdfunding solution performed last year. Further, the paper explains how there has never been any evidence of anyone “hacking a blockchain’s underlying protocol, but digital currencies are still vulnerable to theft.” The report details that U.S. officials must combine efforts to combat “growing pains and misuses.”

“Policymakers, regulators, and entrepreneurs should continue to work together to ensure developers can deploy these new blockchain technologies quickly and in a manner that protects Americans from fraud, theft, and abuse, while ensuring compliance with relevant regulations,” the 2018 economic report researchers conclude.

What do you think about the U.S. government’s 2018 Economic Report dedicating a whole chapter towards bitcoin, and blockchain technology? Let us know what you think about this subject in the comments below.

Images via Shutterstock, and the 2018 Economic Report.

Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’s Wiki page for an in-depth look at Bitcoin’s innovative technology and interesting history.

On March 15 the post-cable network Cheddar announced it will be broadcasting a thirty-minute show about cryptocurrencies called ‘Crypto Craze.’ The show will explore investment strategies for digital assets like bitcoin, litecoin, and ethereum.

Online Stock Brokerage Firm Sponsors a TV Show Called ‘Crypto Craze’

The online trading platform that offers custom equities, options and bitcoin futures, Tradestation, has announced they are sponsoring a new television show about cryptocurrencies. The show called ‘Crypto Craze’ will air every Thursday morning between 10:30 am to 11:00 am ET from the floor of the New York Stock Exchange. Tradestation and the cable network Cheddar believe the prices of digital assets like bitcoin and ethereum have attracted a lot of interest. The new ‘Crypto Craze’ broadcast hopes to entice millennial investors who represent a good portion of Cheddar’s target audience.

“We’re excited to sponsor Cheddar’s new ‘Crypto Craze’ show,” explained John Bartleman, President of Tradestation during the announcement. “Tradestation has been at the forefront in offering our customers the ability to trade Bitcoin futures on the CFE and CME exchanges.”

Cheddar CEO Says Crypto Craze Will Cut Through the Noise

Besides cryptocurrency analysis and investment talk, the show will also dive into the realm of initial coin offerings (ICOs), mining, and the regulatory climate. “’Crypto Craze’ will examine all things crypto,” the show’s creators state. The show will be Tradestations second broadcast as they also sponsor ‘The Long and the Short’ a show about stock trading.

“The ‘Crypto Craze’ is real and it’s here to stay,” explains Jon Steinberg, founder, and CEO of the cable network. “Cheddar’s new show will give viewers real-time metrics with in-depth analysis of cryptocurrency, blockchain technology, regulation and initial coin offerings.”

It won’t be the old guard telling you about a phenomenon they don’t understand. The ‘Crypto Craze’ cuts through the noise and tells you what matters in the world of cryptocurrency.

Other shows on the financial news network Cheddar feature politics, cannabis, technology, and business. The network has broadcasts daily from the NYSE floor, Nasdaq, and the White House in Washington DC. According to the company the network garnered 148 million views in August of 2017 across all its platforms.

What do you think about a show that covers 30 minutes of trading analysis and news on television? Let us know what you think about this show in the comments below.

Images via Pixabay, Cheddar, and NYSE.

Do you like to research and read about Bitcoin technology? Check out Bitcoin.com’sWiki page for an in-depth look at Bitcoin’s innovative technology and interesting history. Bitcoin is a decentralized digital currency that enables near-instant, low-cost payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: transaction management and money issuance are carried out collectively by the network. Read all about it atwiki.Bitcoin.com.